"It's a smart move by Reddit because they're deploying ad units and rollouts where they have seen their users will tolerate -- and have shown a willingness to engage with -- them," she told the E-Commerce Times.

Show Me the Money

Beta partners saw an increase in surfaced conversations and a click-through rate two times greater than the industry standard for social platforms, according to Reddit.

Those stats, cited in a Kenshoo study released in April 2019, reference eMarketer findings for Q3, 2018, which indicate the click-through rate (CTR) growth for social media ads was 22 percent.

Reddit's User Issue

Trending Takeover ads offer better engagement with users, "which should be a more effective approach to drive people to engage with the brands and consider the related products," observed Rob Enderle, principal analyst at the Enderle Group.

However, Reddit "is famous for extreme controversy, and a lot of brands won't want to take risks associated with the service," he told the E-Commerce Times.

"Right now on Reddit, the hot question is, if you could get $100 for life to jerk off, or a one-time payment of $1 million, which would you choose and why," Miller said.
"That has 26,000 votes and 6,700 comments. But is it worth a 2x click-through rate for a brand that focuses on family and morality? Likely not."

When Chris Hansen, from the NBC Dateline To Catch a Predator program, showed up to his own AMA (Ask Me Anything), the conversation "got graphic around pedophiles et cetera," Miller noted.

"Would every brand out there want to be aligned with a conversation about pedophiles -- or hunting and catching them, for that matter?" she mused. "Probably not. But there are plenty of brands that wouldn't care about that and would care about all the eyeballs glued to the AMA."

Brands should exercise caution, Enderle advised.

"If I were looking at placing Trending Takeover ads, I'd sure make management aware of, and sign off on, the risks, as this could be a career-ender otherwise," he remarked. "Even with the sign-offs, it could be hazardous."

Reddit users "are going to be far more likely to instantly start a thread panning irrelevant advertising that isn't in the context of their experience," Miller observed.

"It will be swift and it will be brutal. Brace for the immediate payback with your very own Reddit thread blasting your ad and your very existence," she said.

People turn to Reddit "to get down and dirty advice," Miller added. "Advertisers, regardless of format or form factor of the display, need to be respectful and mindful of that."

Companies' ads have to help them prove they are part of the Reddit community, she suggested. They "can't be random or feel out of place or out of time."

A one-size-fits-all display ad will not make the cut, Miller cautioned. "Alert your tracking team to make sure they have included Reddit tracking and sentiment analysis ... so that a response strategy is in place before ads go live."

Those who get it right might "see an industry average CTR and maybe even higher if they match with that trend or with the audience in general," she said, "but they also get to live another day without a social sentiment explosion on their hands."

Taking On Twitter

Trending Takeover ads "are more interactive than Twitter," Enderle noted. "Twitter is far safer for now, but, for the right company, Reddit could be pretty compelling."

Reddit and Twitter "are a bit like apples and pears," Miller remarked. "They feel similar but are not the same thing."

Reddit users "are there for news, but also to question, observe and be part of a conversation," she said. "Twitter users are there for news and to observe, but there's a bit more shouting into the chamber with a byproduct being comments, replies or response. Reddit users post to engage. Twitter doesn't necessarily have the same motion. Advertisers need to understand and respect both motions."

Richard Adhikari has been an ECT News Network reporter since 2008. His areas of focus include cybersecurity, mobile technologies, CRM, databases, software development, mainframe and mid-range computing, and application development. He has written and edited for numerous publications, including Information Week and Computerworld. He is the author of two books on client/server technology.
Email Richard.